A Portfolio Has a Beta of 1

question 81

Multiple Choice

A portfolio has a beta of 1.23 and a standard deviation of 11.6 percent.What is the Sharpe ratio if the market return is 12.4 percent and the market risk premium is 7.9 percent?

• A) 0.07
• B) 0.11
• C) 0.65
• D) 0.84
• E) 0.90

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Definitions:

Sexual Reproduction

A biological process by which organisms create offspring by combining genetic materials from two different sexes, typically involving the fusion of sperm and egg cells.

Variation

The occurrence of differences among individuals within a population, due to genetic differences and environmental factors, which can lead to biodiversity.

Mutation

Any change in DNA; may include a change in the nucleotide base pairs of a gene, a rearrangement of genes within the chromosomes so that their interactions produce different effects, or a change in the chromosomes themselves.

Clones

Genetically identical organisms, cells, or molecules derived from a single parent entity.